Earlier in the day the bank’s shares had climbed more than 3% with the initial market reaction to its results decidedly positive.
The FTSE 100 was virtually unchanged at 7294.
The bank reported profit of £3.23bn versus £1.1bn the previous year. Underlying profit was only marginally up however a £6.4bn versus £6.2bn.
There was light at the end of the PPI tunnel in the statement with the bank saying total costs fell from £4.4bn in 2015 to £1.4bn in 2016.
Barclays also said it is reducing its stake in Barclays Africa to under 50% and announced a final dividend of 2p, meaning the full year dividend is 3p, down from 6.5p.
CEO Jes Staley has been leading a restructuring of the bank, and took the opportunity to strike a positive tone on its progress.
“A year ago we laid out our intention to accelerate the restructuring of Barclays and refocus our business as a transatlantic, consumer, corporate and investment bank, anchored in London and New York,” he said. We have made strong progress against this agenda in 2016. Our core businesses, Barclays UK and Barclays International, are doing well, with profit before tax excluding notable items up 4% to £6.4bn.”
“Lower PPI costs and currency tailwinds have helped boost profits at Barclays, while good progress has been made in winding down the bad bank that has been holding the group back,” noted Laith Khalaf, senior analyst at Hargreaves Lansdown. “The performance of Barclays’ core UK and international divisions was somewhat underwhelming though, with underlying profits actually falling back slightly. Overall Barclays is in better shape than it was, and the accelerated timetable for the run-down of its non-core assets will be received positively by the market. However once the bad bank is consigned to the history books, there will be nothing for management to hide behind if the core business is not delivering.”
